Facebook Won't Control Libra, Top Exec says

With members of Congress calling for a halt on Facebook's (FB - Get Report) cryptocurrency plans, the executive in charge of the project, tried to dissuade concerns in a blog post on Wednesday.

David Marcus, a former president at PayPal (PYPL - Get Report) who's now in charge of Facebook's Libra project, took to (where else?) Facebook to address some of the blowback from lawmakers since the project was announced two weeks ago. Facebook shares closed 1.1% higher on Wednesday.

"Facebook will not control the network, the currency, or the reserve backing it. Facebook will only be one among over a hundred members of the Libra Association by launch. We will not have any special rights or privileges," he wrote. "Facebook created a subsidiary -- Calibra -- that will operate a wallet service on top of the Libra Network, and while Facebook, Inc. owns and controls Calibra, it won't see financial data from Calibra."

The post addressed Libra's governance structure, financial inclusion, and how decentralization will work within the network, but it isn't likely to satisfy lawmakers.

On Tuesday, a group of House lawmakers, led by Financial Services chair Rep. Maxine Waters (D-Calif.) formally asked Facebook to suspend work on the project in a letter to Facebook CEO Mark Zuckerberg, COO Sheryl Sandberg and Marcus.

"If products and services like these are left improperly regulated and without sufficient oversight, they could pose systemic risks that endanger U.S. and global financial stability," Waters wrote. "Because Facebook is already in the hands of a over quarter of the world's population, it is imperative that Facebook and its partners immediately cease implementation plans until regulators and Congress have an opportunity to examine these issues and take action."

Marcus is set to testify before the Senate Banking Committee on July 16 and the House Financial Services Committee on July 17.

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Federal Reserve Chairman Jerome Powell said in a webcast discussion in Switzerland that Facebook's proposed digital currency would probably have so many users that it might cause instability in the financial system.